I spend a lot of time helping readers get out of debt and learn to save to build wealth. Unfortunately, in the world we live in today, the average savings rate for most people is even lower than what it was in the 70’s!

That should really strike a nerve or at least let your ears perk up. Not to mention, that we are in a down economy – which at least tends to make people hold on to money more. In that sense though, how can we make more interest on the money that we do save and get the best returns?

I’ve gone ahead and compiled a list of 10 great investment strategies to help your money grow so that you can someday achieve your financial dream.

Enjoy!

1. Treasury Bills

If you’ve got at least a minimum of $10,000 to invest, treasury bills are a great investment strategy and backed by the U.S. Government.

Pros: Government backed securities. You can easily make 5% or so on your money and because it’s usually large amounts, it’s easy to reinvest the dividend. Also, they are usually commission and tax free (when collecting returns at redemption).

Cons: Can be a bit hard to purchase as they have large minimum amounts to come up with.

2. Certificates of Deposit

Many people don’t tend to like CDs based on the length of time that they take to mature and cd rates. However, if you choose short term CDs (1-3 months), your money could see decent gains vs. saving your money in a traditional bank account. Shorter terms gain less interest than a longer term for the same CD.

Pros: Good way to stash your cash for a while and build some interest. Longer CDs will pay better interest.

Cons: You can face penalties for early withdrawals (break the CD) and it can tie your money up for the length of the CD term.

3. ING Direct

Offering a better saving rate than traditional banks, ING is a great way to keep your money safe and growing steadily. In its prime, ING offered savings rates of between 2-6%. Currently, you can make around 1% on your money as I write this.

Cons: Usually, you can find better savings strategies, but this is a good mix to keep your money in.

4. Index Funds

Wikipedia describes Index funds as a collective investment scheme (usually a mutual fund or exchange-traded fund) that aims to replicate the movements of an index of a specific financial market. I like to describe them as a collection of some of the best performing mutual funds. As of May 8th, 2012 – the S&P 500 Index has a performance year to date of 9.2% returns.

Pros: Usually stable and reliable investment vs. traditional stocks investing. Moderate, annual returns on average of 5-10% are within norms.

Cons: Can have less returns on investments than similar, yet more risky stock investments.

5. Roth IRA

Assuming that you have access to investing into a Roth IRA, this is a great long term investment strategy. You can contribute a max $5000 per year to your IRA. If you were to do that strategy for say 20 years at an assumed 8% rate of return, you could easily end up with a return of $147,114.61 ($100,000 deposit over 20 years minus your total withdrawal amount – $247,114.61).

Pros: At the end of the Roth IRA term (your retirement age), you have tax free withdrawals (vs. traditional IRAs). Good average rate of returns. Uses the power of compounding interest on gains.

Cons: Beneficiary cannot withdraw from the Roth IRA until meeting retirement age eligibility. Withdrawals before retirement age can be met with taxes and other penalties like most retirement plans.

6. Real Estate

It’s no mystery that as I write this, we are in a housing crash that has affected home prices globally. This should come to no surprise that housing is at a steep discount and can be grabbed up right now for phenomenal buys. Real estate over the last century is still one of the most consistent ways of gaining returns.

Pros: Usually, represent a somewhat stable investment and have had average returns of about 10% annually until the stock crash of 2008. A buy and hold strategy might be the best way to go forward.

Cons: Housing can be much pricier than most investments. Values can drop erratically in a down market, which can also raise risk.

7. Oil

When oil drops less than say $60-$70 a barrel, great gains can be made on this volatile consumable. Politics aside, it still represents a good investment strategy for those looking to diversify their assets. Timing is key to making a great gain. A long term hold approach can also be applied.

Pros: Very high in demand as millions of barrels are traded and consumed daily. Can rise very quickly in stock price based on external factors.

Cons: It’s a controversial consumable that has made the world depend on the Middle East for supply. Fossil fuel that has a finite world supply.

8. Precious Metals

Although gold is at an all time high, other precious metals such as silver, platinum and palladium can be had at fairly affordable rates. Precious metals represent a good way to hold value in something other cash and are very liquid. Gains can be made when world shortages of a particular metal are experienced.

Pros: Great way to hedge against inflation and are usually a great investment in a bad economy.

Cons: Due to the volatility of precious metals, it’s usually recommended to keep no more than 10% of your portfolio invested.

9. Company Shares

If you by chance work for a public traded company or a private held one, you should check out your options in purchasing shares as an employee. Usually, because you work for the company, you may be entitled to benefits for owning company stock that may not available to the general public. Owning shares on a payment plan or being given company stock as an option for remuneration is not unheard of.

Shares in stock can have decent returns and gains over time, so consider it a worthwhile investment.

Pros: Great way to keep your money safe and growing if the company is growing or the stock is up.

Cons: May not be a viable option for all companies. Also, stocks can drop at any time, so keep a diversified portfolio.

10. Become a Book Author

Payments and royalties from becoming a book author can add a great boost in income, especially if you make it on to a best seller list! You don’t have to be a bestselling author to enjoy good sales though, just become an authority in your chosen field that you write in. Respect goes a long way with readers. I’m currently working on this strategy myself.

Pros: With the advent of self publishing and syndication methods such as Kindle, Nook and others. It’s very easy to publish an online version of your book as well as a physical copy. Book Authors can enjoy good passive income with a fairly popular book.

Cons: There’s no guarantees that your book will resonate with the pubic on a whole which may result in lower sales.

I hope you’ve enjoyed these top 10 tips that can make money grow for you without too much effort in today’s economy. As always, consult your financial planner and always diversify your portfolio of investments to hedge against losses.

(Dwight Anthony is a Personal Finance and Financial Freedom blogger that runs the Financially Elite Blog. Drop by and visit – where you can learn topics on Achieving Financial Freedom and other Personal Development tips. While there, make sure to pickup your FREE â˜Golden Nuggets – 25 Absolute Steps You Need for Financial Freedom’ Guide that can put you on the path to building real wealth in life.)

This post was written by yours truly, Jon Elder. My mission is to help you succeed in your personal finance life. Join me on the journey to financial freedom! You can subscribe through RSS FEEDor EMAIL updates. You can also find me on TWITTER
and FACEBOOK
. Happy investing 🙂

This post was written by yours truly, Jon Elder. My mission is to help you succeed in your personal finance life. Join me on the journey to financial freedom! You can subscribe through RSS FEEDor EMAIL updates. You can also find me on TWITTER
and FACEBOOK
. Happy investing 🙂